Mkt 435 - Nike Repositioning Paper

Repositioning Paper: Nike

MKT/435

                March 17, 2013

Michael Stutler

                                               Abstract

In a recent report of Nike’s Segmentation, Targeting, and Positioning, the marketing team identified the existing target markets for the product, and how it is positioned against its competition.  First, the of segmentation of different variables in identifying specific groups of consumers, next targeting by determining which segment to serve, then positioning by applying the segmentation through enhancing the products for that segment and communicating the message to differentiate the Nike brand from its competitors. The report also examined the role that consumer behavior plays in the positioning of the Nike product as it relates to basic marketing concepts.  The report concluded in a discussion of the impact of purchasing trends on consumer behavior, such as globalization, cultural changes, and technology, and how these trends will affect the marketing of the Nike product.  Another report followed in which Nike analyzed the impact of the various internal and external influences, and environmental factors that may influence consumer perception of the marketing message associated with the Nike product.   This final phase of creating value through Repositioning includes an explanation of the roles of learning and memory theories in developing marketing strategies, and recommendation of the marketing mix and distribution strategies to successfully reposition the product supported by consumer behavior concepts and theories.  Additionally, an analysis of the elements of the consumer decision-making process, level of consumer involvement, and concluding in an analysis of the post-purchase process of the consumer, and criteria with a timetable for measuring the success of the repositioning strategy.

                         Repositioning Paper: Nike

Footwear powerhouse Nike is recognized as the World’s leading retailer of high-end athletic shoes, equipment, and apparel.  Established in 1964, by Phil Knight and Bill Powerman, the company logo is of a simple white swoosh that exhibits quality and innovation, and the trademark phrase of “Just Do It,” brings inspiration to many users of its products worldwide.  Today, in an effort to remain as the most recognizable brand worldwide, Nike continues to strategized and target their immediate recreational consumers and athletes in seeking new opportunities to expand its brand’s value.  The marketing team explores the repositioning phase with outward thinking and knowledge from the marketplace.

 Learning and Memory Theories

Learning is a change in behavior, and it comes with experience. When a person sees an advertisement more than once, he or she will tend to remember the message, and what the message is trying to convey to its target audience or market. If a message from an advertisement is received successfully, a marketer or marketing company has achieved the purpose of an advertisement. To relate the theory to learning and memory, it simply is a combination of different factors in an effort to explain whatever the theory is about, and the way a person understands the information and stores it to memory. Two main theories in learning are classical conditioning, which is learning by association. Marketers use classical to create a certain image. The second is operant conditioning, which is learning by reinforcement, this conditioning occurs when a person is rewarded for his or her actions ("Developing a Marketing Strategy," 2010).

On the other hand, memory theory occurs when an individual processes information, and stores it to memory. This process relates to marketing when a person sees an advertisement he or she will tend to remember the product if it appeals to him or her. With memory, each individual’s perception is selective, and “our” memory is highly selective. Nike is in a category that people have a wide variety of brands choices. Nike marketers must make their product as unique as possible. Nike has created a memorable brand and logo quite. When “you” see or hear the words “Just Do It” most will know the product or advertisement is Nike. In the cognitive processing of product and price information, consumers will make a comparison between the price they see, and a price or price range they have in mind for the product (Peter & Olson, "e.g., Chapter 18, Consumer Behavior and Pricing Strategy," 2008).

Consumer Behavior Concepts & Theories

Every customer will show an inclination towards a certain product or service.  Consumers’ interest is nothing more than the willingness to purchase products based on their taste, needs and financial ability.  Of Course, the holidays and Christmas time especially, the buying inclinations grow in contrast to other times of the year.  Fluctuations in the markets, as well as recession tend to decrease the buying power of many consumers.  Facts reveal that consumer behavior has not changed a whole lot since marketers began tracking it and using it to sell ideas, products and the occasional bridge (Cohen, 2011)

     The 4 P’s with Distribution Strategies

The targeting of consumers by Nike leans towards the ones of who love their product.  Nike has always set their prices higher than the competition in order to push its perceived product value. Consumers that consider a product due to the high quality are more likely to pay the price, no matter the cost, more often.  Nike prides itself on the stable of athletes they have promoting their products and being the face of their company.  In America, it is common to see famous stars such as LeBron James and Michael Jordan to Tiger Woods and The University of Oregon.  In Europe, soccer sensation Ronaldo is the face commonly seen on the soccer pitch. This creates the bar of Nike’s product awareness.  Besides the athletes, the advertising of Nike products is commonplace in any sport venue across the nation.  Efficient distribution of their products with more sales and profit is the key to Nike and their overall success.  Strategies that Nike uses when it entails distribution are one that can lead with the edge on the market or lag behind the others such as Reebok and Adidas.  Delivering the correct product on time to the consumer effects the satisfaction and loyalty of those consumers.  Nike has a “level-based” distribution, meaning high priced, premium product, is given to priority distributors.  The lower end goods are given to stores like Wal-Mart and mega retail stores due to their tendency to mark products down or put them on sale.